Comcast’s NBCUniversal in Talks to Invest in BuzzFeed

Comcast Corp.'s NBCUniversal is in advanced talks to make a significant minority investment in BuzzFeed, as the media giant hunts for ways to reach young audiences, according to people familiar with the situation.

The terms being discussed would involve a roughly $250 million investment by NBCUniversal in BuzzFeed, a hot new media property that has built a huge audience of young users over the past several years, the person said. The deal would value BuzzFeed at around $1.5 billion.The talks are fluid, so the terms may change or the deal may yet fall apart.

BuzzFeed CEO Jonah Peretti

Bloomberg/Scott Eells

Comcast is also in talks to raise its roughly 14% stake in Vox, which owns a suite of eight websites that together average more than 50 million unique visitors a month. That deal would value Vox at roughly $850 million, the person said.

NBCUniversal owns channels including USA, Bravo, E! and MSNBC. Like other media companies, the Comcast unit is struggling with the decline of ratings, particularly in younger demographics, as viewing shifts to online video and more people drop their pay television connections. The median age of prime-time TV viewing rose from 46.3 to 50.5 in the five years ending in June 2015, according to a Horizon Media analysis of Nielsen data.

BuzzFeed has quickly risen to the top of the digital media heap through its aggressive use of social media, which helped it draw in 79.6 million unique visitors in June, according to comScore Inc. In late 2014, the site received a $50 million investment from Andreessen Horowitz that valued it at $850 million. Through cleverly-constructed “native ads” or sponsored content, the site said it brought in more than $100 million in revenue last year.

But it also has increasingly turned its focus to video, which brings in substantially higher ad dollars than other kinds of advertising vehicles. It has rapidly expanded its Los Angeles-based BuzzFeed Motion Pictures studio to churn out content largely designed to be watched on social media platforms rather than its own site.

Last month, BuzzFeed Chief Executive Jonah Peretti said the company was actively exploring how to bring that content to television screens, making a potential partnership with Comcast worthwhile.

There's no certainty that investing in new media sites will be an effective strategy, however. Companies like BuzzFeed and Vox are trying to navigate an increasingly crowded Web news landscape, and there are questions about the sustainability of building businesses primarily with advertising revenue.

Amol Sharma contributed to this post.

CORRECTION: Vox Media owns eight websites. An earlier version of this post said the company owns seven sites.